Governor: Shut state offices 2 days a month

Published 4:00 am, Saturday, January 10, 2009

Photo: Rich Pedroncelli, AP

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Gov. Arnold Schwarzenegger said he will restart stalled state budget talks in hopes of getting an agreement to deal with a $42 billion deficit during a news conference at the Capitol in Sacramento, Calif., Wednesday, Jan. 7, 2009. (AP Photo/Rich Pedroncelli) less

Gov. Arnold Schwarzenegger said he will restart stalled state budget talks in hopes of getting an agreement to deal with a $42 billion deficit during a news conference at the Capitol in Sacramento, Calif., ... more

Photo: Rich Pedroncelli, AP

Governor: Shut state offices 2 days a month

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Most state offices will be shut down on the first and third Fridays of each month, beginning in February, as a money-saving measure to help ease the state's growing budget deficit, Gov. Arnold Schwarzenegger told state agencies Friday.

The planned closures follow Schwarzenegger's Dec. 19 executive order that state workers must take two unpaid days off each month between February and the end of June 2010.

Mandatory furloughs have been among Schwarzenegger's demands to help solve the state's estimated $40 billion budget deficit in the next 18 months.

On Friday, he sent the Legislature a budget that calls for deep cuts in education, health care and programs for the poor while raising money through taxes and borrowing.

"We chose these days so that at least employees can get three-day weekends out of it. We want to make this as painless as possible," said Lynelle Jolley, a spokeswoman for the state Department of Personnel Administration. The move is designed to save as much as $1.3 billion through June 2010.

State services that require round-the-clock operation, such as prisons and hospitals, will remain open, but employees there will have to take unpaid time off on other days, Jolley said. The same will be true for revenue-generating agencies such as state parks.

But at least one official said his agencies won't follow Schwarzenegger's mandatory furloughs. Treasurer Bill Lockyer sent a letter to state personnel officials arguing that the governor's executive order doesn't have authority over agencies headed by another constitutional officer.

The union is one of four bargaining units that have sued the governor to stop his furlough plan. A hearing has been set for Jan. 29 in Sacramento County Superior Court.

But Schwarzenegger has argued that trimming government costs must be part of balancing the state's budget and averting a looming cash crisis.

Schwarzenegger's budget "is the only proposal that's going to get the job done," said Aaron McLear, a spokesman for the governor. "It represents a balanced approach of new revenues and spending reductions to get the state through this crisis."

But it's unlikely the Legislature will simply adopt the governor's budget proposal, which is similar to his previous plans that failed to garner support as California's fiscal crisis deepened.

Still, "there's no finger pointing and certainly there are no lines in the sand from our end," state Senate President Pro Tem Darrell Steinberg, D-Sacramento, said Friday. "We are going to get it done."

Jennifer Gibbons, a spokeswoman for Assembly Republican leader Mike Villines of Clovis (Fresno County), said that while Republican lawmakers support some of Schwarzenegger's ideas, they remain opposed to raising taxes.

"But we will work with the governor and the Democrats, and we hope to come up with a compromise soon," she said.

That needs to be done soon, given warnings that the state could run out of cash by next month. State Controller John Chiang told state agencies last week that he might begin issuing IOUs as early as Feb. 1.

H.D. Palmer, a spokesman for the state Department of Finance, said California could be as much as $4.1 billion in the red in March, but that could be avoided if the governor's plans are adopted by end of this month.

Schwarzenegger's proposal is a combination of deep cuts, new taxes and borrowing billions of dollars to make up the huge deficit.

Education, health care and the poor are among the biggest losers as the governor wants to cut $17.4 billion in state spending.

Schwarzenegger proposes to raise $14.3 billion through a temporary 1 1/2-cent increase in the sales tax, broadening the sales tax on certain services such as auto repair, a severance tax on oil produced in California, a nickel-a-drink excise tax on alcohol and a reduction in the amount of tax credit for dependent care.

But those solutions would not be enough. The governor wants to move forward with his earlier proposal to borrow against future state lottery sales ($5 billion) and take out almost $4.7 billion in short-term loans to be repaid in the 2010-11 fiscal year.

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